As the stock market came to a close to end the week investors saw the Dow Jones Industrial Average, Nasdaq Composite Index, and the S&P 500 rally to the upside moving higher after 7 of the past 11 weeks of downside pressure. Next week will be the start of earnings season beginning with (AA) Alcoa, and that will give investors a good idea of the direction of the markets in the near term.
The Volatility Index ended the week down 17.07% at 24.98 as investor confidence turned to the downside after 2 weeks of prior upside momentum. This was the worst week for the Volatility Index since since March. As for the foreign exchange market the U.S. dollar continues to tank against a basket of major currency pairs as it ended trading lower for the 5th consecutive week in a row.
The top stocks that helped to take the market higher were companies such as (KSP) K-Sea Transportation +45.12%, (SNBC) Sun Bancorp +42.34%, (LPTH) Lightpath Technologies +40.13%, (NEXMD) Nex Med +37.72%, and (GBX) Greenbrier Companies +31.97%.
The price of a barrel of oil moved to the upside as the oil index ended the week trading at $76.28 per barrel up $4.09 or 5.67% higher to the upside. The price move was its biggest since late May of this year. The price of oil may move higher in the week to come but will need to break above the $80.05 per barrel area.
At the gold index there has been downside pressure taking the index lower for the past 2 weeks as it retreated from its multi year price high. The gold index needs to break above $1,226.25 area in order to move higher. The multi year high for the price of gold is at $1,265.05 as the index ended the week trading at $1,211.40 down -0.20 or -0.02%, 54 points away from a new high in price.
At the Dow Jones Industrial Average there was a complete turn around as the index had one of its best weeks in 2010. The index began the week trading at 9,689.21 before moving to a price low in the 9,659.01 area but ending the week trading higher on the upside. The index is currently above its 5 week moving average but below its 10,32, 50 and 200 week moving averages.
The top price movers in the Dow 30 this week were (AXP) American Express Co. +8.59%, (DD) Dupont Co. +8.37%, (STX) Seagate Technology Holdings +8.31%, (CAT) caterpillar +8.21%, and (BAC) bank of America Corp. +7.47%. The Dow Jones Industrial average ended the week trading at 10,198.03 +511.55 or 5.28% higher on lighter than average upside volume of 3.09 billion. The average weekly trading volume for the index is 4.34 billion.
Over at the Nasdaq Composite Index there was also an up tick as stocks moved higher in the tech weighed index. The Nasdaq began the week trading at 2,122.28 and moved to a price low in the 2,077.77 area before turning higher to the upside. The index moved as high as the 2,196 area before ending the week trading slightly lower. The Nasdaq is currently trading below all of its major moving averages and will need to breakout above the 2,341.50 area in order to move higher to the upside.
The top movers in the Nasdaq 100 this week were (RIMM) Research in Motion +11.34%, (FWLT) Foster Wheeler Corp. +11.20%, (ALTR) Altera Corp. +10.01%, (STLD) Steel Dynamics +9.87%, and (KLAC) KLA Tencor Corp. +9.61%. The Nasdaq is poised to move higher to the upside in the near term but must move above its 5, 10, 32, 50 and 200 week moving averages. The Nasdaq ended the week trading at 2,196.45 up +104.66 or 5.00% higher on lighter than average volume of 7.99 billion. The average weekly trading volume for the Nasdaq composite index is 11.36 billion.
The Standard and Poors 500 closed to end the week with its biggest gain in over a year. The index advanced helping to lift the market higher to the upside. The top S&P 500 stock movers this week were companies such as (APC) Anadarko Petroleum corp. +19.28%, (MBI) MBIA, Inc. +17.65%, (MI) Marshall & Ilsley Corp. +16.52%, (ANF) Abercrombie & Fitch Co. +15.91%, and (KEY) Keycorp +15.65%.
Downside support for the index is at 1,010.91 with upside resistance at 1,131.23. The index is currently below its 10, 32, 50 and 200 week moving averages but slightly above its 5 week moving average at 1,077.28. The S&P 500 ended the week trading at 1,077.96 up +55.38 point or +5.42% higher on volume of 14.99 billion. The average weekly trading volume for the S&P 500 is 20.95 billion.
By: Marlin Rolle
*** Please have a close look at the charts below ***